May I Refuse to Contribute My Money to this Entity?

by Don Boudreaux on December 24, 2006

in Politics

If the Enron scandal is a sufficient reason to question the morality and the effectiveness of capitalism, what lesson ought we draw from this letter, appearing in today’s Washington Post, from the Comptroller General of the United States?

The largest employer in the world announced on Dec. 15 that it lost about $450 billion in fiscal 2006.  Its auditor found that its financial statements were unreliable and that its controls were inadequate for the 10th straight year. On top of that, the entity’s total liabilities and unfunded commitments rose to about $50 trillion, up from $20 trillion in just six years.

If this announcement related to a private company, the news would have been on the front page of major newspapers. Unfortunately, such was not the case — even though the entity is the U.S. government.

To put the figures in perspective, $50 trillion is $440,000 per American household and is more than nine times as much as the median household income.

The only way elected officials will be able to make the tough choices necessary to put our nation on a more prudent and sustainable long-term fiscal path is if opinion leaders state the facts and speak the truth to the American people.

The Government Accountability Office is working with the Concord Coalition, the Brookings Institution, the Heritage Foundation and others to help educate the public about the facts in a professional, nonpartisan way.  We hope the media and other opinion leaders do their part to save the future for our children and grandchildren.

DAVID M. WALKER
Comptroller General of the United States
Government Accountability Office

Washington

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{ 4 comments }

james higham December 24, 2006 at 12:14 pm

The lesson to be drawn is that – communism or capitalism, people will always be greedy. Merry Christmas, gentlemen. Have a restful time and be of good cheer. James

Robert Coté December 24, 2006 at 1:52 pm

Total liabilities is a red herring. While I share a deep concern for accounting and deficit, your totalling liabilities without also anticipating revenues is misleading. Besides, a huge component of those liabilities are entitlements; medical and retirement that I know for sure I'll never see. If I'm not going to see any then they aren't ruly liabilities now are they?

Personally I'm looking to become an illegal alien. I can pay $2000/year in back taxes for the last 4years and get the rest forgiven. Sign me up.

Anyway, it is warm and sunny. I'm painting my deck and mowing my driveway (one of those grassy things peculiar to mild areas like ours. So, enough durm und strang. Wishing everyone the best this holiday season. Celebratory Saturnalia to all.

Alex Forshaw December 24, 2006 at 4:20 pm

Well, you can't both stay and refuse to contribute. But you can move to the Carribean and then refuse to contribute.

Unfortunately, by the time it's clear to the information-poor rent-seekers in Washington, it will already be too late. Capital will be too well established in more capital-friendly polities to bother coming back to the septuagenarian morons who have and always will run things in DC.

But the nice thing about states is that they have Force, an asset that doesn't belong to private companies, at least not to small and mid-sized ones. Force is very expensive to obtain, but it does miracles for government balance sheets.

http://the-ts-maven.blogspot.com

Tim December 25, 2006 at 6:25 am

Who are "the brightest guys in the room" now?

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